Ex-Congressman Steve Stockman gets 10 years in fraud case

1of36Former U.S. Congressman Steve Stockman and his wife Patti Stockman walk into the Federal Courthouse for jury deliberation on the federal corruption charges against him Tuesday, April 10, 2018, in Houston.Photo: Godofredo A. Vasquez, Staff Photographer / Houston Chronicle

2of36Check out some of the odd and curious facts revealed during the trial of former U.S. representative Steve Stockman (R-Texas).Photo: File/Houston Chronicle

3of36Rehab

He gave $11,000 of charitable funds, which a witness said were meant for the rehabilitation of a row house for Capitol Hill interns, to the Bay Area Recovery Center in Dickinson, where Stockman’s friend underwent a 30-day treatment program for alcohol addiction.Photo: Google Maps

He used charitable money on groceries, utilities, cell phone charges, dry cleaning and paid off and his own other people's credit card debt. He also paid off a Sam's Club card and bills from Frye's, Lowe's, Home Depot, Nordstrom, Target and Walmart.Photo: Danny Johnston, Associated Press

He spent money for a purchase near the Egyptian pyramids in the city of Giza and cash withdrawals in Egypt and Switzerland.Photo: Amr Nabil, Associated Press

26of36Hardcover pop-up Christmas books
He spent $24,000 in October 2013 for “heirloom quality” Advent books created by his brother and sister-in-law to be published at a printing house in China. The former congressman never received any of the 500 copies he pre-ordered, according to testimony from his brother, the book's author, John “Jack” Stockman. His brother told jurors he believed the copies were stashed somewhere in the basement of his home in Oak Park, Illinois.Photo: The Advent Book website/ Jack Stockman

He wrote a rent check to Patrick Murphy, a new and used hot tub distributor who owned Aahhh Comfort Spas. The check was compensation for the use of a former motorcycle repair shop adjacent to the spa store in Webster, which Stockman used as his congressional campaign headquarters. Although it lacked a shower and kitchen, the ramshackle building underneath I-45 doubled as home to some of Stockman’s campaign volunteers, many of whom had problems with alcohol addiction, according to testimony from Jason Posey, one of the interns who lived there. “It was a dump,” Murphy told jurors.Photo: Joe Holley, Houston Chronicle

He spent money on a pair of disposable cellphones, known as “burner phones,” and cards to activate them. These phones are known to be difficult for law enforcement to trace, an FBI agent testified. Stockman asked his aide to buy the burner phones so they could discuss use of surplus funds from what was supposed to be an independent campaign expenditure for a tabloid political mailing. Witnesses testified that Stockman directed the use of funds from the expenditure but tried to cover his tracks.Photo: Christina Hayden / The Potpourri

An FBI special agent explained to the jury how Stockman used Bitcoin to forward funds to a co-defendant who had fled to Egypt to avoid investigators. The currency is difficult for law enforcement to trace, she testified.Photo: Mikhail Primakov / Dreamstime

At one stop on that Egypt trip, Stockman met top defense ministry officials. Dahl, the woman who helped set up meetings with civilians and officials for Stockman's journey, wasn't party to their conversation. But she was copied on a pitch the following month by Stockman to two top Egyptian defense officials. Stockman said in the message that he wanted the military leaders to ask CEMEX, a multinational cement company with headquarters in Mexico, for a $30 million donation that would go toward helping Americans understand the situation in Egypt. The deal never materialized.Photo: MONICA RUEDA, ASSOCIATED PRESS

Around the same time that Stockman copied Dahl on a 2013 emailed pitch to the Egyptian defense ministers, Dahl began reporting for Breitbart. Her stories on the alt right website, founded by Steve Bannon, continued until August 2016. Bannon subsequently become chief strategist for President Donald Trump. Dahl , who has been portrayed in news reports as an ally of Bannon, served briefly on Trump's National Security Council. She also reportedly worked previously as an aide to former U.S. Congressman Michele Bachmann.

He paid for two people to spy on state Rep. James White, R-Hillister, shown above, whom Stockman thought might be mounting a primary challenge for his seat in Congress. Prosecutors contended that Stockman was fearful that an African American politician would be his challenger. He stated in a 2013 text message presented in evidence that “Republicans love black conservatives.” Benjamin Wetmore, a political operative and self-described “undercover journalist” who ultimately became Stockman’s lawyer, oversaw both spies and also helped Stockman find interns for his congressional office in Washington, D.C. One Stockman spy, Oluwaseun "Shaughn" Adeleye, got hired as an intern at White’s office but was actually working undercover for Wetmore. Adeleye told the jury he was equipped with audio and video equipment but he never got anything useful. He documented White’s car in a parking lot and had footage of visits the lawmaker made to an Austin frozen yogurt shop. Wetmore told him via email he wanted to know whether the car was messy.Photo: Cassie Smith

Another spy hired with the donation money was following White’s movements from outside the office. He shot a blurry photograph of White’s home and tracked visits he made to two Austin bars.Photo: Ryan Pelham / Ryan Pelham/The Enterprise

Stockman was linked to a number of charities during the trial, many of which witnesses said were sham organizations that he used to funnel the money toward his own expenses. Charities he was involved with include the Ross Center, Operation Medical Mercy, the Center for the American Future, the Egyptian American Friendship Society and Life Without Limits. This last group, which was used for many of the donations involved in the scheme was originally a 501c3 established by a man in Las Vegas, who set it up to address life issues when a relative is dealing with a major illness. Witnesses said Stockman was connected with a team that purchased the defunct charity.Photo: ISAAC BREKKEN, STR

A witness who flew to Houston from the Republic of Congo to testify for the defense, she had known Stockman since 2007, and he was beloved by the people of her region for his humanitarian work,. She said they referred to him as "Uncle Steve." Stevie Bidjoua Sianard-Roc, one of two witnesses called by the defense team, told jurors on one trip he brought three boxes of medical supplies across the border into the Democratic Republic of Congo and delivered them to the hospital founded by former Rockets center Dikembe Mutombo, shown above. The airline wouldn't let him load additional boxes he had tried to bring, she said.Photo: ED COX, AP

Former Republican congressman Steve Stockman, a Tea Party stalwart who represented southwest Houston and then East Texas, was sentenced to 10 years in federal prison Wednesday for a wide-ranging scheme that included spying on a potential GOP rival and misspending charitable contributions from conservative donors.

A political expert who has monitored Stockman's political trajectory likened the right-wing firebrand's downfall to that of President Richard Nixon, who was also disgraced for spying on opponents and covering up payoffs and other financial misdeeds.

Stockman, 61, of Clear Lake, is different, of course, in that he was convicted on April 12 of 23 felony counts for illegally diverting for his own personal use $1.25 million in donations to his federal election campaigns. He has spent the past six months in 12-man cell in a Conroe jail awaiting his sentence.

Chief U.S. District Judge Lee H. Rosenthal said the ex-lawmaker's sentence should take into account that Stockman hired workers to sneak around and rifle through trash of a perceived opponent from his own party. It was important to consider that Stockman cheated taxpayers and constituents, attempted to cover up his acts to avoid detection and continued to seek the political spotlight all the while, the judge said.

"You stole money and used it for personal gain and you used it to violate the public trust," Rosenthal told Stockman, who stood before her in an orange jail uniform and beige rubber clogs that were chained together at the ankles. "You cheated the American taxpayer."

In addition to his prison term, the judge ordered him to serve three years of supervised release and repay $1.014 million to foundations run by two deep-pocketed donors.

Stockman, who remained silent during his sentencing, smiled and blew a kiss to his wife as a U.S. Marshal led him out through a side door.

A prosecutor asked that Stockman be given an enhanced sentence of 14 years on the grounds that he allegedly duped a vulnerable 86-year-old Baltimore philanthropist into giving away hundreds of thousands of dollars.

"Mr. Stockman demonstrated that he was not somebody who felt himself bound by the law or by the rules," said Assistant U.S. Attorney Robert Heberle. "He lied over and over and over again to people who were in charge of charitable foundations to get money that could have gone to legitimate charitable causes."

Defense lawyer Marlo P. Cadeddu asked for 13 months — the average sentence for public corruption. The judge said that term "doesn't come close to capturing this unique violation of the public trust."

After sentencing, defense attorney Charles Flood, said his client did not address the judge because the Stockman was afraid he might become too emotional.

"Steve remains hopeful," Flood said. "He believes in his innocence and he maintains his faith on appeal."

Two former congressional aides Thomas Dodd, 39, of Houston, and Jason Posey, 48, of Tupelo, Miss., pleaded guilty to helping in the fraud and gave key testimony at trial. They are set for sentencing on Dec. 12.

Texas's Richard Nixon

Stockman rose to prominence in the mid-90s as a U.S. representative for southwest Houston. Almost two decades later, in 2013, he returned to Congress, this time representing a swath of East Texas counties, but cut short that term to launch a failed bid for John Cornyn's seat in the U.S. Senate. Stockman's politics were in line with the Tea Party's conservative libertarian thinking before that party ever existed, according to Brandon Rottinghaus, a political science professor at University of Houston who has studied Texas politics.

"Stockman unseated long-serving liberal Congressman Jack Brooks, which was a signal that a new conservative movement was taking hold in Texas," said Rottinghaus. "He was part of a new breed of conservatives that were reshaping Texas and American politics."

The UH scholar sees Stockman as "Texas's Richard Nixon" because he siphoned off funds and orchestrated amateur political surveillance.

Dolphin watching and Advent books

Stockman was arrested in 2017 as he attempted to board a flight to the Middle East in 2017. The federal inquiry followed investigations of Stockman by the Sunlight Foundation and the Houston Chronicle that examined a series of 2013 checks that straw donors made to Stockman's depleted congressional campaign fund.

Federal agents had gathered evidence that the ex-representative had committed wire and mail fraud, laundered the illegal proceeds of his crimes, violated federal election law and lied on a tax return.

In the trial that followed, prosecutors introduced reams of documents how Stockman attributed donations to two aides and then revised documents to say that the funds had been donated by the aides' parents. The jury also found that Stockman had funneled charitable donations through a series of sham nonprofit organizations and shell bank accounts to spend on an array of personal expenses that included his brother's homemade Advent books and a dolphin-watching trip.

One project was an amateur spy operation that trailed a perceived GOP rival, state Rep. James White, R-Hillister, around the statehouse in Austin.

White, who was just re-elected to his seat, said Wednesday he found it strange that Stockman would invest in surveillance right after he was sworn in for his second congressional term.

"Instead of concentrating on all these other issues we have in the country — health care, border security, war in the Middle East — his first intuition was his own political survival rather than the survival of ordinary Texans," White said.

Schoolchildren, constituents and a federal inmate hoping for best

Present at the sentencing was Mark Michalek, a special agent who oversees public corruption investigations in the FBI's Houston office. He said the office has looked into many complex, multijurisdictional schemes by officials who use their positions for personal profit.

But he noted that cases like Stockman's don't come to the FBI unless people report fraud.

"Preserving the public's trust in government is a responsibility that we don't take lightly," he said, noting that, "we rely heavily on the public's help in investigating these crimes."

Stockman's wife Patti sat in court with nearly 20 friends and constituents who came to support her husband. Fifteen supporters and one fellow jail inmate also submitted letters to the judge praising Stockman's good deeds. His wife said she has been overwhelmed by the support, including an email that came Tuesday about a classroom of schoolchildren who were praying for him.

Patti Stockman thinks the criminal case was politically motivated.

"My husband was a very vocal whistleblower about the corruption of the Obama administration," she said.

Gabrielle Banks covers federal court for the Houston Chronicle. Follow her on Twitter and send her tips at gabrielle.banks@chron.com

Gabrielle Banks covers federal court for the Houston Chronicle. She has been a criminal justice and legal affairs reporter for nearly two decades, including staff work at the Pittsburgh Post-Gazette and The Los Angeles Times, and freelance work for The New York Times, The Mercury News, Newsday and The Miami Herald. She has a graduate degree in journalism from Columbia University. Before her years as a reporter, she worked as a teacher, social worker and organizer.